The Board of Directors of Citigroup Inc. (NYSE:C) announced today that Vikram Pandit has resigned as its CEO and director, effective immediately. Michael Corbat, who previously served as Citigroup’s CEO of Europe, Middle East and Africa has been named as the new CEO and as a director.
John P. Havens, President and Chief Operating Officer, has also resigned. According to Citigroup’s press release “Mr. Havens said that he had already been planning retirement from Citi at year-end but decided, in light of Mr. Pandit’s resignation, to leave the Company at this time.”
The announcement comes one day after Citigroup announced better than expected financial results and its stock price jumped over 5% on much heavier than average volume.
Reaction so far has mainly been one of surprise and even shock, especially since no mention of the personnel changes was made in connection with yesterday’s earnings release. Plus generally in an organization as large as Citigroup, you expect a well-planned succession process with the old CEO perhaps remaining on the board of directors for a period.
Mr. Pandit was named CEO in December 2007 and steered Citigroup through the financial crisis. Although Citigroup came through the crisis successfully, its stock price has lagged behind its competitors. Some commentators have also remarked on what are seen as Citibank mistakes over the past year, most notably the low price and related write-down Mr. Pandit accepted for Citigroup’s exit from Morgan Stanley Smith Barney.
But still, the suddenness is a shock. We’re likely to hear more about this over the days and weeks to come.